The suits, filed by law firms Milberg Weiss Bershad & Schulman LLP and Stull, Stull & Brody, allege that Take-Two Interactive Software misrepresented the financial contribution that the game would make to the company, and failed to disclose that the video game, originally rated as suitable for over 17s, contained hidden scenes of a sexual nature.
These were discovered in July last year after an unauthorised software download, known as Hot Coffee, was released onto the internet. This had the ability to unlock the hidden, sexually-explicit scenes, although the makers said the content was never intended to be accessible to the public.
The game was re-rated from M (Mature) to AO (Adults Only) when the scenes were discovered – and instantly suffered a drop in sales, as most major retailers refuse to stock games with AO ratings.
Take-Two and its subsidiary Rockstar Games took a further hit last month when, on 27th January, Los Angeles City Attorney Rocky Delgadillo sued the firms, alleging that they had engaged in unfair business practices by hiding the sex scenes in the game.
The legal actions filed this week seek compensation on behalf of those employees and members of the public who had purchased or acquired shares in the company in the period between 25th October 2004 (the date on which the game was launched) and 27th January 2006.
According to the filing by Milberg Weiss Bershad & Schulman, the firm was motivated to engage in the fraudulent and illegal conduct during the class period in order that company insiders could sell more than 661,000 shares of their personally held Take-Two stock for proceeds of over $18 million.
